Central Government Elections – Viewpoint Column

We’re acutely aware of how much property rates we pay as we get a regular bill. One positive thing about this is we’re focused on what’s done with our rates. On the other hand, last time you bought a coffee or went to the supermarket did you glance at the GST on the receipt? Unlikely.

Source: interest.co.nz

In 2019 the government collected a staggering $19 billion in GST, that figure only eclipsed by PAYE at $33 billion. Perhaps we should ask what our GST is being spent on?

Auckland Council’s ‘Emergency Budget’ has shown that property rates make up 37% of the council’s revenue with the balance coming from user-pays charges, development contributions, and dividends from Ports of Auckland and Auckland International Airport. As this non-rates income crashed a gaping hole appeared in council’s budget.

Rodney is the second-fastest growing area in Auckland. House building from Riverhead to Warkworth has highlighted the lack of infrastructure. This should be in lock- step with growth, not at some unspecified time in the future. Replicated across Auckland the lack of funding for population driven infrastructure could not have come at a worse time.

History shows government is reluctant to fund Auckland’s infrastructure unless voters are going apoplectic.  The previous government conducted the political equivalent of the dance of the seven veils before finally contributing to the Central Rail Link. This government hyped light rail but that’s mired in MMP politics, stranded somewhere in the traffic jam on the North-Western Motorway. To add insult to injury, when projects like the Puhoi to Warkworth motorway are finally built Aucklander’s are seen as an easy touch for revenue gathering in the form of tolls!

Governments have unleashed immigration on Auckland creating economic growth and healthy GST revenues. The government also enjoys access to higher levels of borrowing than council and a wider ability to increase revenues. They have passed on responsibility for convoluted RMA and building code regulatory and social functions to the council, neatly sidestepping the deep frustration all this red tape causes while avoiding the costs council has to recoup. It’s not surprising council operating costs have increased; every time government creates some new regulation it is frequently councils who are left having to implement them.

It’s time to move away from property rates as a way of funding the huge list of growth-related projects we need to keep the city moving. There are $6 billion of unfunded projects in Auckland’s Regional Land Transport Plan.

The government should put in place a mechanism to return a portion of our GST to Auckland Transport specifically for growth-related projects. This would free up funding to increase repairs and renewals on our crumbling road network and tackle the local projects that won’t be delivered for decades under the current funding arrangements.

This election we need a government that will return our taxes to deal with Auckland’s transport mess, something to consider when casting your vote!

Huapai Alternative Route

Local Board Update July 2020

Progress on one of our area’s most needed transport improvements.

Note: This is the updated route in December 2020.

Plans for an alternative state highway to SH16 between Brigham Creek Road and Waimauku are progressing with a preferred route expected to be confirmed to property owners around the middle of next year.

Property owners were told last year that they were in a ‘study area’ for the proposed new state highway. The study area is much wider than the land that will be required for this new transport route.

The Supporting Growth Programme team, who are leading this planning work on behalf of Waka Kotahi NZ Transport Agency and Auckland Transport, have sent letter to the property owners contacted last year to update them on progress and timeframes for what happens next.

The team have told me they’re currently refining the route and will ask to meet late this year with property owners still affected once the refinements are done. They then expect to be able to confirm that route in mid-2021.

The next step will be for the route to be finalised by a designation process, which could take two further years.

The alternative state highway is set down to be built in line with the anticipated rezoning and land release timeframes of the wider Kumeu-Huapai areas later this decade.

As well as improving congestion and travel times, the alternative state highway means the existing SH16 through Kumeu-Huapai will become a really important part of those revitalised town centres, with much-reduced through traffic.

The Supporting Growth team is also progressing the planning for a network of new and upgraded public transport connections, walking and cycling paths and roads for the north west in the long term, and will be talking to communities as these progress.

For more information, including a map of the indicative route of the alternative state highway, see www.supportinggrowth.nz  email info@supportinggrowth.nz or call 0800 4769 255.

https://supportinggrowth.govt.nz/assets/North-West/b09fcf3b0a/Kumeu-Huapai-Alternative-State-Highway-Corridor.pdf

Challenging Few Years Ahead with Council’s Emergency Budget.

Councillors will shortly be making a decision on the levels of rate increase (3.5% or 2.5%) and wrestling with the implications of a predicted $500m fall in revenue on the coming years budget.  What is not widely known is that property rates only provide 40% of Auckland Council’s income. With the sharp drop in revenue from fees and charges, dividend payments from shares Council owns in Auckland Airport and Ports of Auckland, there is now not enough money to fulfil all the previously proposed budget spending. Increased borrowing is not possible as it would inevitably lead to a lowering of Council’s international credit rating and push up the interest rate paid to borrow money that would mean more income would be diverted to repayments at a time when that income has fallen.

Council has moved swiftly to reduce spending shedding 1100 staff in the last few months making it second only to Air NZ in terms of job losses. More of this and budget cuts will follow.

At a local level we are still working through what this will mean but it is going to see projects delayed for a year or longer.

Having spent the last six years battling for infrastructure to meet growth and parity of services with the rest of Auckland this is a frustrating time. The next three years were going to finally see the delivery of some larger projects and these may now be delayed or cut depending on how large the cuts are. Progress on some local projects is contingent on the Government stepping up with ‘shovel ready project’ funding which will plug the yawning hole in Council’s budget.